Credit Suisse chairman says no sign of foreign exchange rigging

PHOTO: Credit Suisse chairman says no sign of foreign exchange rigging

ZURICH - Credit Suisse has found no evidence of foreign exchange market manipulation and that such a liquid market would be difficult to rig, its chairman said in an interview published on Sunday.

Switzerland's financial markets regulator said this month that it was conducting investigations into several Swiss institutions over possible manipulation in the $$5 trillion (S$6.23 trillion)-a-day foreign exchange market.

"As is normal with such large-scale investigations, we have also received inquiries from certain authorities, as is the same for other banks. That is normal procedure, it was also like this with Libor," Urs Rohner told the NZZ am Sonntag newspaper.

"We have up to now, however, found no evidence of malpractice. To date it is also still not clear what precisely the topic of investigation is," he said.

Regulators and investors have grown increasingly concerned about the integrity of financial benchmarks in the wake of the Libor interest rate-rigging scandal.

On Friday, the US Justice Department said it was making inquiries into allegations of foreign exchange rate manipulation centred on the Swiss franc but has left the heavy lifting to Europe, according to a source familiar with the probe.

In a wide-ranging interview, Rohner also defended Credit Suisse's investment banking business, which it has scaled down since the financial crisis began in 2008.

"I am convinced that we have an investment bank that in good years can achieve 3-4 billion Swiss francs (US$3.30-US$4.40 billion) in pre-tax profit," Rohner said.

He said Credit Suisse could use these funds for expansion in its other businesses, such as global asset management.